Conflict in the Telecom Market: Major Operators Oppose New Rostelecom Requirement

At the end of July, Russia’s largest telecom operators—including VimpelCom, MegaFon, MTS, Southern Telecom, and YUTS—sent letters to the Director of Operator Relations for the Central Region at Rostelecom and the Deputy Head of Roskomnadzor. These letters addressed a notification from Rostelecom about changes to the rules for routing telephone traffic at the local (municipal) and zonal (regional) levels in Krasnodar Krai, Rostov and Astrakhan regions, and North Ossetia. The newspaper Kommersant reviewed these letters.

Under the new conditions proposed by Rostelecom, operators are required to reroute all traffic through the zonal level. Rostelecom explained this change by citing outdated equipment at local communication nodes, which prevents the company from connecting them to the state “Antifraud” system for call verification.

The operators disagreed with the new requirements, referencing legislation that obligates all operators—including Rostelecom—to verify calls at all levels, including the local level. In response, Rostelecom stated that if operators do not begin rerouting traffic according to the new rules by August 5, the company will block such traffic as “illegitimate.” A representative from Southern Telecom told Kommersant that as of August 5, network disruptions have already been observed in four cities in Krasnodar Krai.

An MTS letter noted that blocking at the local level could prevent MTS and other operators’ subscribers from reaching Rostelecom subscribers. Such a situation could disrupt the normal operation of hospitals, social and government institutions, state enterprises, and law enforcement agencies. Operators also pointed out that the capacity of connection points at the zonal level is insufficient for seamless traffic routing, which threatens network overload and failures.

Telecom representatives believe that Rostelecom’s ultimatum is unacceptable given the current political and economic circumstances, especially considering that a medium response level has been in effect in Krasnodar Krai by presidential decree since 2022.

Rostelecom claims it is acting within the framework of domestic legislation. MegaFon and MTS declined to comment, while VimpelCom noted that Rostelecom’s actions create significant difficulties for telecom operators and negatively impact service availability for customers.

The founder of YUTS pointed out that call termination rates at the zonal level are three to four times higher than at the local level, which will lead to a significant increase in operator costs and, ultimately, higher expenses for subscribers. Southern Telecom stated that an increase in costs by more than 2.5 times for the same service will significantly affect their financial position. According to them, rerouting traffic will increase Rostelecom’s revenue and raise the expenses of connected operators by at least 50 million rubles per year for just one major operator.

The Ministry of Digital Development is aware of the situation and is investigating. The ministry emphasized that there is no talk of blocking traffic or communication failures, and that all services will be fully provided at all strategic and socially significant sites in the regions. The ministry promises to find a compromise to avoid additional financial burdens for local telecom operators.

Roskomnadzor told the publication that “Rostelecom’s optimization of traffic routes is due to technical features of the network’s construction.” At the same time, Roskomnadzor stated that “Rostelecom’s lack of technical capability to comply with legislation regarding call verification at local communication nodes should not affect citizen safety.”